DCA, Sebi to turn the heat on errant companies

The department of company affairs (DCA) and the Securities and Exchange Board of India (Sebi) will initiate action against the 604 vanished companies identified by the Bombay Stock Exchange.

This follows the demand of Midas Touch Investors Association, which in its letter had asked that the Sebi, DCA and the joint monitoring committee initiate action against the firms as per the directions of the Allahabad High Court given on March 26,1999,on a writ filed by the association.

The DCA has given orders to its regional director, Mumbai, for appropriate action and Sebi has taken up the matter with the exchanges for verification.

Midas in its letter had further clarified that the companies identified by the BSE as having disappeared, and putting them in the unknown category is based on the following creteria laid down by the BSE: "The exchange sends all its correspondence( such as listing fees bill, copy of amendment to the listing agreement, investor's complaints etc to the companies listed on the exchange at its registered office, available with the exchange.It has been observed that correspondence in respect of companies given below with addresses(last known) are returned undeliverd by the postal authorities for reasons such as "not known", "shifted" etc.

Trading in the securities of these companies is already suspended by the exchange. The list is drawn as on April 8, 2003.There are 604 companies in the unknown category.